No pay rise for Royal Mail boss

Royal Mail has announced that it will not increase the salary of chief executive Moya Greene - at her own request.

The move appears to sidestep a potential clash with the Government, which still holds a 30% chunk of the group after it was controversially privatised last year.

It comes after it was reported today that ministers were on a collision course with the company after chairman Donald Brydon wanted to improve Ms Greene's pay after she steered Royal Mail through the stock market flotation.

In a statement, the company said: "The remuneration committee of Royal Mail group has decided not to propose any base pay increase or new incentive arrangements for the chief executive officer.

"In doing so, the committee has taken into account the views and wishes of the CEO."

Ms Greene's total pay package for the year to March 2013 was £1.22 million. This does not include a controversial £250,000 perk to help her buy a house, which she repaid. But it was still up from £1.1 million the year before.

This included a £498,000 base salary - unchanged since 2010 - as well as her bonus, pension and other benefits.

A potential hike in her pay for the current year was seen as threatening to clash with Business Secretary Vince Cable's call for boardroom restraint.

It is the latest controversy to hit the group amid accusations that last autumn's stock market float saw it sold off on the cheap.

The company was initially valued at £3.3 billion but a surge in the share price since then has seen it soar to more than £5 billion.

Last week, MPs were told that the asset management arm of Lazard, independent adviser on the sale, made an £8 million profit for its clients selling shares in the first week of trading following privatisation. The bank said there was a "Chinese wall" over the advice.

Business Secretary Vince Cable said: "I admire the restraint the Royal Mail board has shown today. I appreciate the continuing good work of Moya Greene, their CEO, in transforming the business."

Last month he wrote to the chairs of the remuneration committees of each of the top 100 companies listed on the London Stock Exchange urging pay restraint.

Dave Ward, deputy general secretary of the Communication Workers Union, said: "Companies such as Royal Mail should be mindful of the gulf between the pay of senior staff and the lowest-paid employees, particularly as those on the lowest incomes are financially squeezed because of the increase in the cost of living.

"We welcome Royal Mail's decision to freeze the salary of the chief executive. The UK has one of the highest pay gaps in its private sector companies in the world and any steps towards addressing these inequalities instead of making them worse are welcome."

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